Case Note & Summary
In 1988, arbitrators passed an award directing Oil & Natural Gas Commission (ONGC) to pay US$1,804.50 and US$59,593 as interest on delayed payments, plus future interest at 12% per annum till realisation. ONGC challenged the award under the Arbitration Act, 1940, but its petition was dismissed by a single judge of the Bombay High Court on 9 August 1988. An intra-court appeal was dismissed on 25 October 1988. The ONGC then obtained special leave from the Supreme Court, which on 5 March 1991 directed the ONGC to deposit the award amount while restricting the withdrawal of future interest. Before that order, on 25 April 1989, a decree was drawn up in terms of the award, converting the US dollar amounts into Indian rupees. On 11 August 1992, the ONGC deposited US$61,379 with the Prothonotary & Senior Master. The Supreme Court finally dismissed the ONGC's appeal on 23 April 1999, confirming the award. Thereafter, on 22 June 2000, the ONGC tendered a demand draft for US$32,481.78 and a cheque for Rs.155/- to record satisfaction of the decree, but the Prothonotary refused to accept it on the ground that the amount should have been deposited in 1991 per the Supreme Court's order. The claimants moved an interim application before the Supreme Court seeking clarification. The ONGC then filed a chamber summons in the High Court, leading to the present appeal. The judgment does not disclose the final decision.
Issue of Consideration
Case Details
2006 LawText (BOM) (11) 37
Appeal No. 28 of 2002 in Chamber Summons No. 298 of 2001 in Arbitration Petition No. 65 of 1988 in Award No. 43 of 1988
D.D. Madon, S.A. Bhalwal, R.V. Govilkar, G.S. Pikale
Oil & Natural Gas Commission
M/s. McClelland Engineers S.A.
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Nature of Litigation
Appeal against the order passed in Chamber Summons seeking to compel the Prothonotary & Senior Master to accept the deposit of the decretal amount and to record the decree as satisfied.
Remedy Sought
The ONGC sought to have the decree recorded as satisfied upon deposit of demand draft and cheque.
Filing Reason
The Prothonotary & Senior Master refused to accept the demand draft for US $32,481.78 as the amount was required to be deposited in 1991 as per Supreme Court order.
Previous Decisions
The arbitral award was challenged unsuccessfully; the arbitration petition to set aside the award was dismissed by learned single Judge on 9th August, 1988; the Division Bench dismissed the appeal on 25th October, 1988; the Supreme Court granted special leave but dismissed the appeal on 23rd April, 1999; decree in terms of award passed on 25th April, 1989; ONGC deposited US $61,379 on 11th August, 1992; later ONGC attempted to deposit balance via demand draft on 22nd June, 2000 which was refused.
Judgment Excerpts
The dispute was referred to the arbitrators who passed an Award on 29th February, 1988, directing the ONGC to pay to the claimants: 1) US $ 1,804.50 being interest on US $ 40,102.97 at 12% p.a. from 1/12/1985 to 16/4/1086 and 2) US $ 59,593 being interest on US $ 3,12,011.50 at 12% p.a. from 3/5/1983 to 5/11/1984.
The Application for grant of stay is rejected. Special Leave granted. The appellant will deposit the amount in compliance with the Award but the respondent will not be permitted to withdraw the amount of future interest allowed @ 12% p.a. by the Arbitrator from the date of the Award till deposit.
the Office of the Prothonotary & Senior Master, High Court, Bombay, on 25th September, 2000 refused to accept the demand draft of US $ 32,481.78 as, according to the Prothonotary & Senior Master, the said amount was required to be deposited in the year 1991 as per the order of the Supreme Court dated 5th March, 1991.
Procedural History
Award dated 29 February 1988; ONGC filed Arbitration Petition No. 65 of 1988 to set aside award; petition dismissed on 9 August 1988; appeal dismissed on 25 October 1988; decree in terms of award passed on 25 April 1989; ONGC filed Special Leave Petition before Supreme Court on 24 February 1989; leave granted on 5 March 1991 with directions to deposit; ONGC deposited US$61,379 on 11 August 1992; Supreme Court dismissed appeal on 23 April 1999; ONGC tendered demand draft for balance on 22 June 2000 but Prothonotary refused; Chamber Summons No. 298 of 2001 filed; Appeal No. 28 of 2002; oral judgment delivered on 20-21 November 2006.
